An arm of Dutch ammonia producer OCI is partnering with Abu Dhabi National Oil Co (Adnoc) on what it expects will be the first cargo of low-carbon blue ammonia shipped to trader Itochu in Japan.
The blue ammonia will be produced by fertiliser producer Fertiglobe, in which OCI holds 58% and Adnoc owns 42%, at its Fertil plant in the Ruwais Industrial Complex in Abu Dhabi.
The plant currently produces “grey” ammonia but will be fitted with CO2 liquefaction units. The CO2 will then be transferred to and reinjected into underground reservoirs by Adnoc’s Al Reyadah carbon capture and storage plant to enable the production of blue ammonia.
“The shipments, which were sold at an attractive premium to grey ammonia, underscore the favourable economics for blue ammonia as an emerging source of low-carbon energy,” OCI said.
Blue supply chains
The company added that the sale supports the development of new UAE-Japan blue ammonia supply chains and represents the first production milestone of a planned scale-up of blue ammonia production capabilities in Abu Dhabi.
- Grey or brown ammonia: Produced from fossil fuels.
- Blue ammonia: Produced using natural gas but with CO2 capture and storage.
- Green ammonia: Produced from hydrogen made through water electrolysis using renewable energy.
Adnoc ADQ and Fertiglobe are also teamed on a new production plant at TA’ZIZ complex in Ruwais. With 1m tonnes per annum blue ammonia in production capacity, it is due for start-up in 2025.
These first cargoes from the Fertil plant are for trial use in fertiliser production.
But Itochu executive officer Masaya Tanaka, who is president of the energy and chemicals company as well as chief operations officer of its power and environmental solution division, said the outfit aims to create a wide range of ammonia value chains for existing industrial applications and future energy use.
Itochu is leading a joint study, which now has 34 participants, on the use of green ammonia as a marine fuel.
New opportunities
OCI said it is working to unlock new opportunities for blue and green ammonia.
In March, the company signed with Eastern Pacific Shipping, the Hartmann Group and MAN Energy Solutions, and outlined how it is targeting sales of its products to the shipping sector.
In addition to the initiatives in Abu Dhabi, OCI has the capability to sell up to 365,000 tonnes per annum of blue ammonia at the OCI Beaumont plant in Texas into the US market or internationally and offer the product at OCI Nitrogen in the Netherlands.
In its second-quarter results briefing on Monday, OCI chief executive Ahmed El-Hoshy highlighted several recent shipping announcements on ammonia-fuelling for vessels by Euronav on VLCCs and suezmax tankers, and AP Moller-Maersk on its methanol-fuelled boxship newbuildings.
"We see tremendous momentum building up from ESG [environment, social and governance factors] that has resulted in many tangible opportunities across almost all our sites globally, which the team is actively evaluating," El-Hoshy said.
"In that context, we are pleased that we continue to make good progress in expanding our offering of low-carbon products to our customers rapidly in order to fulfil these exciting developments."
